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Growing Pains
400 Secrets by Mark Gordon | Managing Editor
Jim Needham tells doctors pondering job offers at the orthopedic and sports medicine practice he runs they should assume this is the place where they will have their retirement party.
And that's more than just a chest-pounding boast: The 12-doctor practice, Bradenton-based Coastal Orthopedics and Sports Medicine, is set up to encourage lifetime commitments, stopping just short of lifelong contracts.
"You don't go into a marriage thinking it will end in divorce," says Needham. "So why do that with a job?"
Needham, 38, swallows a dose of his own medicine, too. In 2004, when he met with the doctors running the then-floundering and nearly bankrupt practice, he signed what's essentially a lifetime commitment plan. He wanted the in-this-together feeling to be there on both sides, and the doctors who owned the practice agreed.
All new Coastal doctors and physicians' assistants are now treated as equals, as opposed to a senior-junior relationship common at many medical practices. The firm has 128 employees, including the doctors.
The unusual hiring philosophy works. The company, whose patient list ranges from active retirees to Tampa Bay Buccaneers, had revenues of $26 million in 2006, a 44% increase over the $18 million in 2005. The company placed 239th in the Review's listing of the 400 biggest company's on the Gulf Coast, which was published this week.
What's more, the growth comes just two years after the company nearly closed its doors, the victim of what Needham called becoming a financial-oriented practice as opposed to a medical-oriented one.
From the late 1990s through 2004, says Needham, the practice had trouble making payroll and paying rent. Many doctors, staff and patients left the practice. The ones that stayed were rewarded with cuts in salary and benefits. Says Needham: "It was just a disaster."
Medical navigation
Prior to joining Coastal, Needham, an Iowa native who holds an MBA, not an M.D., had been working as head of operations for the surgery division of a hospital chain in Fort Worth, Texas.
Coastal, meanwhile, was being run by a medical practice management company - part of the problem, according to Needham and Dr. Arthur Valadie, who has been with the practice for 10 years. There was a lack of responsive leadership from the management firm, Dr. Valadie says, and with high fixed costs and other medical office problems, the office was nearly run out of business.
"I called it suits versus stethoscopes," says Needham. "Neither side trusted each other."
Needham's first challenge after replacing the management firm was to hire new doctors, made painfully difficult by the lack of incoming revenue. In addition to touting the two-way commitment, Needham began spending money to make money. The firm invested significantly in technology, for example, developing a paperless records system and utilizing several new online and high-tech MRI and X-ray viewing systems.
Like many health care costs, technology doesn't come cheap: The practice, says Needham, has spent $2.4 million on technology the last few years.
In addition, the practice grew its medical offerings as it hired new physicians. It's now one of the most comprehensive sports medicine and orthopedics practices in the Bradenton area, says Needham. Services include the basics, such as physical therapy, pain management and orthopedic bracing, as well as the innovative, such as reverse shoulder replacement, hip resurfacing and knee replacements that use a GPS navigation system to align the joints between a patient's ankles and hip.
In addition to the Buccaneers, Coastal doctors and staff work regularly with the Pittsburgh Pirates when the baseball team is in Bradenton for spring training, as well as hundreds of teenage athletes from the area's high schools, including ones from the IMG Academies.
Needham says he'd like to expand the practice physically, hopefully in about five years. Coastal currently has three offices: Its 40,000-square-foot headquarters near Blake Memorial Hospital in Bradenton, and two smaller offices in eastern Manatee County.
Building a new medical building, though, has some unique, and costly, challenges, Needham says. Those include high impact fees that can be even higher for medical offices and federal regulations, such as making sure the operating rooms are at least 10 feet high and building extra-large toilets in every bathroom.
REVIEW SUMMARY
Business. Coastal Orthopedics and Sports Medicine, Bradenton
Industry. Health care
Key. Medical practice turned around a bleak financial situation by developing a two-sided lifetime commitments for doctors.
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